Yesterday, State Department officials in Yemen were preparing for the possibility of evacuation. Houthi rebels had laid siege to the presidential palace, and later held President Hadi captive in his own home. The United States Embassy was fired upon, and the Navy was on alert.

Earlier today, however, the Houthi reached a compromise with the U.S.-backed leadership that would give the rebel group more of a say in government, bringing an end to the immediate violence. (It is unclear whether or not Hadi remains a prisoner in his own home.)

Via the AP:

SABA [news agency] said the agreement included a clause that would answer the rebels’ demands to amend the constitution and expand their representation in the parliament and in state institutions. It also included promises to ensure better representation for Yemen’s southerners as well, the deal said.

The agreement also calls on Hadi to shake up a commission tasked with writing a draft constitution to ensure bigger representation for the Houthis.

The draft constitution has proposed a federation of six regions, something the Houthis reject. The agreement reached Wednesday night also ensures that Yemen would be a federal state, but doesn’t mention the six region proposal, saying controversial issues will be further discussed.

The agreement, while addressing the immediate Houthi takeover and security concerns in the capital, leaves the contentious political issues unresolved.

The Houthi reign of terror began last year, when the Iran-backed rebels took partial control of the capital city of Sana’a, and attempted to block the the President from taking power.

On top of concerns regarding Iranian influence in one of the Middle East’s most volatile regions remains the growing influence of Yemen’s al-Qaeda cell. Earlier this month, the group claimed responsibility for the Charlie Hebdo attacks, and promised more violence to come.

This is the type of environment where insurgencies thrive. The official leadership of Yemen has already been forced to concede weakness to a rebel group that only managed to move out of its northern territorial strongholds this past September; this means that not only do the rebels hold a bargaining chip, but the Iranians now have an even greater hand in how the government operates.

As part of the agreement reached, Houthi rebels will withdraw from key parts of the city, and release officials taken hostage—but we don’t yet know what sort of concessions President Hadi will be forced to make, and how that will affect counterinsurgency efforts in an already-volatile Yemen.